Davis' SARA bill is close to becoming law

The way agencies buy services is about to shift heavily toward performance contracts.

The House late last week passed the Defense Authorization conference report that includes the Services Acquisition Reform Act.

'The current acquisition system, although much improved by the reforms of the 1990s, is simply inadequate to leverage the best and most innovative services and products,' said Rep. Tom Davis (R-Va.), the sponsor of the bill.

Davis said SARA will 'put the tools to access the commercial service and technology market in the hands of a trained work force that will have the discretion necessary to choose the best value for government'and be held accountable for those choices.'

The Senate is expected to pass the conference report this week, and then the bill would be sent to President Bush for his signature.

SARA, which Davis' Government Reform Committee passed in March, will:

  • Establish a governmentwide preference for using a performance-based approach for commercial items'including services contracts'of less than $25 million.


  • Authorize the use of time-and-materials and labor-hour contracts for certain commercial services that are commonly sold to the public.


  • Clarify the definition of a commercial item to include services, such as management consulting, commonly found in the private sector.


  • Establish a civilian acquisition work force training fund within the General Services Administration by depositing 5 percent of the fees collected under governmentwide acquisition contracts, including schedule contracts.


  • Create a noncareer chief acquisition officer to help focus senior management on the day-to-day operations at the major agencies, and launch a chief acquisition officer council.


  • Davis said agencies spend $135 billion a year on services and this legislation will 'ensure that we're spending that money more wisely.'

    Alan Chvotkin, senior vice president and general counsel for the Professional Services Council, an Arlington, Va., industry association, said these provisions are the most significant changes in the last 10 years to the way federal agencies buy services.

    He said the training fund, which according to some estimates will be $150 million to $250 million, and the time-and-materials provisions are two of the more important provisions.

    Many in industry have said the Federal Acquisition Regulation is unclear about the use of time-and-materials contracts when buying services and that this law will clarify those questions, Chvotkin said. He added the training fund is long overdue because of the obvious gap in training that many in industry, Congress and agencies recognized.

    'SARA makes an effort to address long standing challenges in acquisition systems for use of services,' Chvotkin said. 'It takes services out of the backwater and puts it front and center in terms of way agencies buy services and draws important attention to it.'

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